The Dasgupta Review Deconstructed: An Exposé of Biodiversity Economics

Published online: 26 May 2021

“In fact, there is nothing new in The Review’s orthodox economic ‘solution’ for loss of biodiversity,
namely, putting a price tag on Nature so that businessmen and financiers can recognize its
existence in their accounts, capture its value and profit from trading. Neither is there anything
new about an economist claiming he can direct environmental policy by correctly pricing Nature
to optimize resource management. However, Dasgupta does not stop there.

Human health, education and population are also to be monetized and treated like man-made
capital. Together three forms of capital – natural, human and produced – are taken to represent the
‘inclusive wealth’ of humanity. In this way, all social, ecological and economic aspects are equated,
allowing their aggregation and integration into national accounting systems. Conflicting objectives
and interests are assumed commensurable via reduction to monetary equivalents that support
financial wealth accumulation. There is no error in this ‘independent’ report having been commissioned
by the Treasury department under a ruling Conservative Party. While pricing, trading-off
and optimizing are traditional economic fare, the political vision here involves a far reaching public
policy agenda, promoting the total domination of non-financial aspects of life by finance.”  [p. 2]

Source: Capitals Coalition (formerly Natural Capital Coalition), Twitter

Clive L. Spash & Frédéric Hache (2021): The Dasgupta Review deconstructed: an exposé of biodiversity economics, Globalizations, DOI: 10.1080/14747731.2021.1929007

Institute for the Multi-Level Governance & Development, Department of Socioeconomics, WU Vienna University of Economics and Business, Vienna, Austria; Green Finance Observatory, Brussels, Belgium

The Dasgupta Review is the latest attempt at justifying financialisation of Nature, but also much more. It represents a high point in applying concepts of capital and wealth accumulation comprehensively to all aspects of human and non- human existence. Unravelling the flaws in the arguments, contradictions and underlying motives requires both understand of and cutting through the specialist language, neoclassical economic models, mathematics and rhetoric. We offer a critical guide to and deconstruction of Dasgupta’s biodiversity economics and reveal its real aim. Framing critical biodiversity loss as an issue of asset management and population size is a blind to avoid questioning economic growth, which remains unchallenged and depoliticized despite apparently recognizing natural limits. Dasgupta ignores long-standing problems with capital theory and social cost–benefit analysis. Rather than a scientific review of biodiversity economics he offers impossible to achieve valuation, based on old flawed theories and methods, embedded in an unsavoury political economy.

ABSTRACT

1. Introduction

2. Dasgupta’s political economy and its values

3. The world as different categories of capital

4. Other issues

Download the PDF: The Dasgupta Review Deconstructed – An Expose of Biodiversity Economics

[Clive L. Spash is Professor of Public Policy & Governance at WU in Vienna, Editor-in-Chief of Environmental Values, and former President of the European Society for Ecological Economics. As an ecological economist he has promoted the need for social-ecological transformation and a paradigm shift in economic thought. He has published widely in the fields of economics, political economy, social psychology, project and policy evaluation, environmental policy, philosophy and ethics. Over thirty years he has conducted research on climate change, biodiversity loss, air pollution, conservation and land-use. His books include: Routledge handbook of ecological economics: Nature and society (Ed., Routledge, 2017), Ecological economics: Critical concepts in the environment, 4 Volumes (Ed., Routledge, 2009), and Greenhouse economics: Value and ethics (Routledge, 2002). More information can be found at www.clivespash.org.]

[Frédéric Hache is a financial expert. He worked for twelve years in investment banking, selling and structuring currency derivatives. After that he was head of policy analysis at the NGO Finance Watch for six years, analysing EU legislation linked to systemic risks / financial stability. He now heads the Belgian think tank Green Finance Observatory, lectures in sustainable finance at Science Po Paris, works as a freelance expert on sustainable finance and environmental markets and is pursuing a PhD in political economy.]